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The Swiss Enlargement Contribution

Since 2008, Switzerland has been participating in various projects designed to reduce the economic and social disparities in an enlarged EU, with CHF 1.302 billion. For despite the rapid growth that characterised the years immediately following EU membership, the level of prosperity in the new EU member states is relatively low and the gap with EU-15 member states is comparably wide. Switzerland’s commitment to EU enlargement is an expression of solidarity. At the same time, Switzerland is consolidating the basis on which to build solid economic and political ties with the EU and its member states.

On 26 November 2006, the Swiss population voted in favour of the Federal Act on Cooperation with the States of Eastern Europe. In doing so, they signalled their approval for financial support aimed at reducing economic and social disparities in the enlarged EU.Federal Act of 24 March 2006

In June 2007, Parliament approved a framework credit of CHF 1 billion for the ten states that joined the EU in 2004: Cyprus, the Czech Republic, Hungary, Estonia, Latvia, Lithuania, Malta, Poland, Slovakia and Slovenia. In December 2009, it approved a second framework credit of CHF 257 million for Bulgaria and Romania, which joined in 2007. In December 2014, Parliament approved the contribution of CHF 45 million to Croatia, which joined the EU on 1 July 2013.

The distribution of the enlargement contribution among the thirteen partner states is based on a distribution formula established on the basis of population size and per capita income. Switzerland has concluded a bilateral framework agreement with each partner state. It decides which projects it supports in consultation with the partner countries and independently of the EU. The Swiss Agency for Development and Cooperation (SDC), the State Secretariat for Economic Affairs (SECO) and the joint local offices in Warsaw, Riga, Prague, Budapest, Bratislava, Sofia and Bucharest provide support to the implementation of the projects.

Why?

Switzerland supports its 13 partner states due to the following reasons:

Solidarity: The Swiss enlargement contribution is an expression of Swiss solidarity

Consolidate relations: Switzerland’s contribution to EU enlargement consolidates bilateral relations not only between Switzerland and the new EU member states, but also between Switzerland and the EU as a whole, its most important political and economic partner.

Business Opportunities: The Swiss enlargement contribution increases the potential for Swiss companies to benefit from new business opportunities.

Promote environmental and climate protection: Local living conditions improve as a result of the enlargement contribution projects. The ongoing widespread poverty and weak state institutions in the peripheral regions, however, harbour political risks which have a direct impact on Switzerland in the form of pressure from migration. Environmental problems do not stop at borders. The environmental projects, many of which contribute to climate protection, are therefore of interest to Switzerland.

Five project objectives:

The enlargement contribution contributes to the reduction of economic and social disparities within the EU. To achieve this, each project fol­lows one of five overarching project objectives:

Promoting economic growth and improving working conditions: With around CHF 322 million, Switzerland supports projects in its partner countries, which support economic growth and improve working conditions. This is also in Switzerland's interest as the Swiss export industry profits from developing the Eastern European growth markets and the increasing spending power in the partner countries.

Improving social security: Switzerland invests around CHF 180 million in a broad range of social security measures in the partner countries. The focus is on elderly and sick people and youth support.

Improving public safety: CHF 113 million of the enlargement contribution flows into projects for improving public safety in the partner countries.

Protecting the environment: CHF 458 million of the enlargement contribution is used for around 80 environmental protection projects. This includes projects for supporting public transport, drinking water supplies, waste water treatment, energy efficient construction, use of renewable energies and biodiversity.

Strengthening civil society: The Swiss enlargement contribution provides CHF 98 million for financing projects that strengthen civil society. A support fund for non-governmental organisations (NGO fund) that includes 700 small projects is financed in all partner countries, except Malta.

Selection of projects and awarding of contracts

Responsibility for identification and preparation of projects in accordance with the agreed priorities lies principally with the partner state. The projects to be financed are chosen together; the decisions concerning financing are made by Switzerland. The awarding of contracts for supplies and services is an independent process downstream of the selection and authorisation of a proposal.

Correct use of funds

Switzerland has taken a number of measures to ensure the effective use of funds. These include close monitoring of the project selection process in the partner country, auditing the tendering process and the allocation of projects and supervision of project implementation. If Switzerland suspects irregularities, it can stop payments.